MTV’s insights into the Millennial generation reveal challenging questions about serving the consumers of the future.

Unless you compete in a market that specifically targets
youth, you probably don’t spend a lot of time thinking about the emergence of
the so-called Millennial Generation in America today.

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And if you don’t spend a lot of time thinking about
Millennials, it may come as a surprise to you that at 100 million strong they are
the single largest generational cohort in American history, dwarfing their
predecessors Generation X, and even out-sizing that most famous of all
generational behemoths, The Baby Boomers.

“But we don’t sell gum or acne cream,” you may still be
thinking, “so why should we care?”

Consider for a moment the half-century long trajectory that
The Boomers have taken from 1960s to the present day. Those bearded idealists
of the civil rights movement are the self same retirees now marching with
placards in the streets protesting for heath-care reform. It’s not hard to see
just how many of the tectonic shifts in culture and commerce over the last half
fifty years have been powered by the demands of the Boomer generation. From Pepsi’s co-opting of Sixties counter-culture, to the
casualization of the workplace, there is a wealth of evidence for how closely linked broad
changes in the American landscape have been to the Boomers moving through time,
like the proverbial egg in the snake.

Millennials are not just a more voluminous generation than
Boomers, but better educated, more self-esteemed, more demanding, more
technologically savvy, more empowered and wired to win at the game of life. And they
are pouring daily by the tens of thousands into the commercial and cultural
mainstream.

In short, no matter what business you are in, they are your
next generation of consumers.

Whether three years, five, or ten from now, sooner or later
the Millennials will be the ones standing in the grocery isle, or in the bank
managers office, or in the car dealership evaluating your product or service
offering, asking “is this for me, really?” More likely, of course, they won’t
be standing in any of these places, but doing it on a voice-activated iPad
while driving to work in Smart Car Version 3.0, but you get the point.

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And if you want a vision of the kind of impact this
generation can have on an industry, just look at some of the categories where
they have come to play already: music– transformed from a big label album-driven model to something so
customizable and just-in-time that it’s barely recognizable as the industry it
once was; clothing–the fast fashion of a Forever 21 shattering traditional
“one merchandise drop per season” models into shards; and of course the
social networking “industry,” remarkable in so many ways, not least of which is
the speed with which a single business entity can go from zero to half a
billion consumers.

At MTV, of course, youth is our market.

MTV made a decision at its point of inception to never grow
old with the audience but to reinvent periodically for each “generation next.”
So naturally, we have been one of the companies impacted first and dramatically
by the Millennial generation coming of age as entertainment consumers.

Because young people are our viewers and because they
are so fast and so fickle (and becoming ever more so), we study them with a
deep intensity and intimacy. We strive to understand not just the “what,” but
also the “why”–their drives (conscious and unconscious), desires, passions,
fears, and challenges.

In all of our work with Millennials, we have identified a
series of traits that are quite unique to this generation (versus prior
generations), and which we believe will have dramatic implications on who
they will become as consumers–not just consumers of entertainment,
but of cars, homes, refrigerators, and shampoo.

Before describing these principles, it’s important to
highlight two tectonic forces that move beneath much of what defines the
uniqueness of this generation. The first, and perhaps most important, is the
recalibration of the nuclear family and, as a consequence, the way this
generation was parented.

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A century of “parent-centered” nuclear family has steadily
been under-going a paradigm shift,
and may have just passed the tipping point. The nucleus of the family has been moving
towards the child, and Millennials look like the first generation raised in
that new nuclear family structure. No longer the hierarchical structure with
authoritarian parent “leadership,” the new family is flattened to a democracy, with
collective (if not kid-driven) decision-making process. Parents are more like
best friends, life coaches, or as we at MTV call them “peer-ents.”

75% of Millennials in an MTV study agreed that “Parents of
people my age would rather support their children than punish them,” 58% agreed,
“My parents are like a best friend to me.”

No longer is it necessary to “rebel against” authoritarian
parents to individuate, engage in acts of self-expression, or push at the
boundaries. As one youth psychologist we work with pointed out, “Parents don’t
say you can’t go to the party, they create safe spaces to consume alcohol, they
say Can I pick you up afterwards?, Here’s money for a taxi.”

Self-expression, having your voice heard, following your own
path–these are all values that are positively encouraged in modern parenting
styles. Why rebel when you simply need to explain your behavior in terms of “my
experiment in self discovery.”

Percentage of
Millennials who agree with the following statements(from MTV Millennial Edge
Study, 2010):
• I’m always expressing
myself in different ways – 81%
• I hate it when other
people expect me to live by their rules – 76%
• If I want something,
nothing is going to stop me – 69%

In short, the power dynamics of the family have shifted
dramatically, and much of the empowered, one could even say “super-powered”
style of the Millennials has its roots in this redistribution.

And in the style of pouring gasoline on a fire, the second tectonic
shift is technology. The “You Demand It,” push button, everything free, always
on culture of technology and the Internet has amplified much of the “social
coding” of the way Millennials were parented. And as many commentators have
already pointed out, the revolution will be tweeted. The power is in the hands
of a million anonymous hands, and can be wielded apparently consequence free,
in real time, with the click of a mouse.

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Based on what we know about what makes this generation tick,
and what we hear and observe about them on a daily basis, we have distilled
down five principles, or perhaps they would be better described as challenges
for businesses thinking about what it will mean to cater to this Millennial
consumer as they come on line in a major way to more and more sectors of
business.

1. What
will it mean when co-creation with your consumer becomes part of your business
model?

A generation
raised on “children should be seen and heard” simply will not be a passive
consumer of anything. They will demand a voice in, a stake in, even a creative
point of view about, everything that your business does–from the product
itself to the way it is sold and marketed, to the social responsibility
policies of the organization itself. They may or may not choose to use that
power (for example only miniscule percentages of people actually contribute to
the crowd-sourced IP of Wikipedia), but they will demand that the mechanisms
are in place that give them the choice to participate and the feeling that
co-creativity drives the development process.

And this probably won’t be a one-time event (“lets go and do
some creative focus groups and get our audience to help us think about
innovation”). It will be an on-going real time feedback loop with demonstrable
impact and validation built in. One of the most buzzed about ad campaigns of
the last few years is Old Spice, where real time changes happen in the
commercial creative as a result of input from the audience. There’s the beauty
of the idea itself, and then there’s the power of the feedback/validation loop
created with the audience–“See, you matter, your vote counts, your impact is
felt and something moves as a consequence, you are smart and creative and you have … power.”
And speaking of smarter …

2. What
will it mean to make your product ten times smarter than it is today?

In all the research we conduct with this generation at MTV,
the word we perhaps hear the most is “smart” (closely followed by “random,”
“awkward,” “awesome,” and “love”). “Smart” means a multitude of things to the
generation, but one thing that’s common is that it carries a very high premium
and social currency. For the most educated generation in history, told by so-called “velcro” parents that smart is
everything, it should hardly be a surprise. And indeed 57% of the generation
consider themselves smarter than their parents, and 68% agree that “Nerds are
the new jocks”!

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We already have the Smartphone, the Smart Car and even Smart
Water. What is smart soap, smart diapers, smart gas stations.

When you investigate the concepts of smartness further with
the generation, some of the nuances that emerge give fascinating insights into
their collective psyche. For something to be “smart” it has to, for example, entertain
me, remember what I do and anticipate my needs, do “everything” for me, have
built-in complexity and layers of meaning, shape-shift, be as smart as me!

3. What
will it mean to be in a “two player game” with your consumer?

Millennials have a natural predisposition to view situations
in terms of the metaphor of a game. Take the workplace–“what are the rules of
this world, what are the levels, how do I get to the 10th one as
quickly as possible (that nice CEO suite on the corner of the top floor), is
there a shortcut, a smart bomb, a secret entrance, a magic potion?” Foursquare,
the location-based social networking site, literally turns one’s social life
into a game complete with badges, medals, trophies, and even mayor-hood awarded
to “players.”

The generation learned young and learned well how to
expertly negotiate with their parents to get a pass out of homework or a day
off school … power-players in the game called “family.” Raised on a diet of almost millions of hours of World Of
Warcraft, elaborate world kid-centered “constructs” like Harry Potter, and
soccer trophies for the whole team, Millennials want to win.

Asked about “worldview” based on the following phrases, the
intergeneration differences here become quickly apparent.

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“Game” the system:
Millennials – 53%
Boomers – 26%

Protest the system:
Millennials – 13%
Boomers – 59%

Marketing to this generation may be more like a two player
game, where everyone’s looking for the win win. How will your campaigns create
a sense of “play” on the part of the audience, a sense of depth and levels, a
sense of engagement, a validation loop, and ultimately a sense of material and
emotional victory (or even of being the special one that figured out how to
game it )? In the marketing campaign for Halo 3, level after level of depth was
buried within layers of the marketing campaign, consumers freeze-framing DVR
playback of commercials to pick up codes embedded in the film to follow
breadcrumbs down Internet wormholes for the next clue.

4. What
will it mean to your business to operate in on-going versions rather than a
final product?

If we had to identify someone who is the face of the
Generation, the way that Bob Dylan perhaps was for the Boomers or Kurt Cobaine
for Xers, then today that face would be Lady Gaga’s. Considered beyond doubt the “most interesting
person today” by the generation the core characteristic of Gaga is the speed
and ferocity of her self-reinvention. She is doing in 10 minutes what it too
Madonna ten years to achieve.

Who do you think is the most interesting person in pop culture today?

Size of word indicates volume of response:

The parental premium placed on self expression for today’s
kids, combined with technology tools to literally “curate the self” in real
time, has created an insatiable appetite for newness. If something does not
version, it quickly becomes boring. This has always, of course, been the
consumer need that drives every company’s innovations engine, but the requisite
rpm of that engine is rapidly going into the red zone as this generation come
on line as buyers. It’s no longer acceptable, for example, that chewing gum
remain the same flavor throughout the duration of the chew. No, the gum has to
flavor-shift mid chew lest the chewer’s dopamine/adrenaline cycles start to
fade and new stimulus is required.

5. What
will it mean when there is no such thing as an un-connected product?

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Everything we are learning about the generation points to a
need to be constantly connected, existentially uncomfortable with the feeling
of being “alone,” experiencing a fear of missing out when they stray to the hinterlands
of their social graph. One interesting piece of research led us to understand
how the automobile, so squarely a symbol of freedom and independence for prior
generations, has become in danger of being perceived as a “disconnection
device” for Millennials. “Trapped” inside the hermetically sealed vehicle, “alone”,
and of course unable to text and check your status update, the feeling of the
open road becomes the very antithesis of freedom, more like isolation.

A product which is ‘un-connected’ has a certain inertness
for the generation. At the more superficial level even the most inert product
can build a web site and “connect”. But it is much more challenging to
re-imagine your product experience by asking how to increase its innate
connectedness. What would a connected retail experience look like? Perhaps like
the so called “haul video” syndrome where kids film themselves in changing rooms
trying out different outfits, post the film of their ensembles in real time,
and seek feedback from their social network on which ones look best before
purchasing.

As the old hockey adages goes, you don’t skate to where the
puck is, you skate to where it’s headed. And in the case of the Millennials,
we’re looking at a hundred million pucks moving towards open ice where bold,
as-yet-unimagined products and services will some day await them. So heads-up, here come the Millennials.